Lynden posts updated Inverstor Presentation

Lynden Energy Corp. has posted a new Investor Presentation on their website. A couple highlights:

1. Wolfberry project now includes 5,985 net acres with 250 BOE/day and estimated production of 450 to 500 BOE/day by the end of 2011.

2. Lynden has 9 gross producing Wolfberry wells and 7 that have been spud or awaiting completion. They have a 43.75% working interest in all but one of those wells. They anticipate 23 gross producing wells and 5 spud by the end of 2011.

3. "Repeatable nature of Wolfberry allows for conservative use of debt financing." This would reduce the need to issue more stock preventing further dilution.

4. Developing "Land Rush" throughout the Eastern Shelf of the Permian Basin with the Mississippian as the primary driver. The Mississippian is being developed in Eastern Oklahoma on similar rock packages as exists at Mitchell Ranch by Chesapeake, Eagle Energy, Sandridge and Range Resources.

Lynden announces update on Wolfberry and Mitchell Ranch projects

Lynden Energy Corp. (LVL) announced that they have tied three new Wolfberry wells into production for a total of eight gross wells. The first well is averaged 79 bo/d and 136 mcf/d over the first 32 days of production. The second well has averaged 49 bo/d and 71 mcf/d over the first 13 days. Lynden's third well is in the Wind Farms area and averaged 90 bo/d and 215 mcf/d over 22 days. Flow rates of all three wells appear to be improving with time. These three wells all appear to be successful and Lynden says that "initial results from the wells are very encouraging."

Lynden expects to drill one new Wolfberry well each month this year and seven new wells are expected to be spud by the end of May. Lynden's success with developing their Wolfberry project continues to derisk their land and increases the company's value. Their recent results validate Keith Schaefer's (Oil and Gas Investments Bulleting) low end valuation of their Wolfberry lands at $0.97/share.

Lynden also announced that their first Mitchell Ranch "has been consistently producing oil and gas at rates that exceed the economic threshold." This is significant news as it's the first indication that the Mitchell Ranch could be a viable project. If they can continue this success with future wells, their valuation could be up to $20,000/acre for their Mitchell Ranch project ($20,000/acre x 50,000 acres = $1 billion).

Once the investment community finds out about Lynden, it's a good bet that their market cap will approach the numbers that others are getting for comparable land. This means that Lynden has the chance to increase by 10X!

SandRidge Energy announces closing of its Wolfberry and asset sale for $155M

SandRidge Energy, Inc. announced today that it has closed the sale of its Wolfberry assets in the Permian Basin. They received cash proceeds of $155M for their properties producing 1,600 Boe/d and having 2.37 MMBoe of proved reserves.

Legacy closes on purchase and says Wolfberry drilling is meeting or exceeding expectations

Legacy Reserves LP announced that they have closed their previously announced acquistion of properties in the Permian Basin (click here to see the release). They also state that "the company's drilling in the Wolfberry play in the Midland area has produced results meeting or exceeding our expectations."

Goldman Sachs releases research stating "Permian Basin Renaissance to Intensify in 2011"

Goldman Sachs released a research report stating that they believe that we are still early in the Permian Basin oil renaissance. There are multiple sources of upside including downspacing, exploration success finding additional productive zones and technology to improve productivity. "There has been a sharp pick-up in industry activity in the Permian Basin." They expect the improvements that were realized in the Permian Basin in 2010 to continue in 2011.

The research was very good in calling attention to the upside potential of companies doing business in West Texas including the Wolfberry trend. As more attention is drawn to this area, the companies exposed to the Wolfberry trend should outperform.

Permian Basin is hotter than it has ever been

The Fort Worth Star-Telegram wrote an article highlighting the Permian Basin and Approach Resources. Highlights include:

- "The Permian Basin is hotter now than when oil was $140 a barrel and it may be hotter now than it ever has been," said Ben Shepperd, president of the Permian Basin Petroleum Association.

- Approach Resources is placing a $100 million bet on the Permian Basin focusing on the Wolfberry trend and drilling "Wolffork" wells. These wells target the Wolfcamp and Clear Fork formations.

- The wells produce oil, natural gas and natural gas liquids from multiple formations and can potentially achieve "a two- to three-year payout."

- "The Permian Basin is undergoing a major revival. Midsize and large producers are plowing money into the Permian, through acquisitions of oil and gas properties costing hundreds of millions of dollars. Lease bonuses... are now topping $10,000 an acre."

- "I think the Permian has an extremely good future," Jim Henry said.